Author: alexdavidrosaria

Alex Rosaria is from Curaçao. He has a MBA from University of Iowa. He was Member of Parliament, Minister of Economic Affairs, State Secretary of Finance and United Nations Development Programme Officer in Africa and Central America. He is an independent consultant active in Asia and the Pacific.

If you know the history of the American ‘gold rush’ you’ll remember that as many as 300,000 people moved to California from 1848-1855 to try to find gold after someone had found the shiny metal on his land. Many of the gold miners had zero mining background however. Not surprisingly the greatest fortunes were not made by those who were searching for gold, but by those who sold shovels, alcohol and sex to the gold searchers.

In China, the State Owned Enterprises (SOEs) were urged by the Communist Party to go abroad as a prelude to The One Belt One Road initiative (launched in 2013) which aims to connect China to the world via networks of roads, railways, ports and other infrastructural projects. Many of the Chinese firms that went abroad looking for new opportunities had little or no experience, just like the gold seekers. But unlike the gold seekers, the Chinese do bring their own tools and don’t offer much opportunities to locals.

One of those SOEs was Guangdong Zhenrong Energy (GZE). Although it had never built a refinery, GZE managed to convince one of the world’s most repressive dictatorships in Myanmar in April 2016- one day before power was handed over to another government- to build the largest Burmese refinery. GZE, I’ve been told, had been telling Myanmar about the multibillion deal in Curaçao in order to score points with the Burmese. In Curaçao, just days before the elections of September 2016, GZE showed a flashy film about its plans in Myanmar minutes before signing a MoU with the Whiteman Administration.

Somehow the Curaçao committee in charge of the future of the Curaçao refinery (MDPT) was totally smitten with GZE. I say ‘somehow’ because the MDPT’s dealings with GZE were never transparent as I told the MDPT President in Parliament back in 2015. In the end GZE played us and Myanmar with the same domino tile. Changá (double play) in Papiamentu. Not bad for a group of rookie oil connoisseurs.

It did not stop however with the Whiteman Administration as some actors (including media outlets) would like us to believe. Subsequent Administrations (Koeiman, Pisas and Rhuggenaath) were not only persuaded by GZE, but considered it a celestial solution to our economic malaise. GZE signed MoUs with the most important actors of the local energy sector and convinced unions that thousands of new jobs were imminent. Unchallenged by politicians, GZE during a Parliament meeting professed its love for Curaçao, promised to build hotels, theme parks and yes, bail out a troubled local commercial bank while somehow finding time to build a new refinery.

Conspicuously most of the independent press was silent on this matter. Undoubtedly it had to do with an all expenses paid China trip to show off GZE which many media workers eagerly accepted.

Looking back I’m proud to have been one of the few people who’s gone against the current to voice my deep preoccupations, even after being ‘seriously warned’ by some local (ex)government people who I later on learned were paid GZE’s consultants, to keep quiet. Upon my return after a project in Myanmar I wrote extensively in 2017 on the dealings of GZE in that country and the investigations of the UN into their corporate behavior. In July 2018 I wrote that GZE would disappear from the map. This finally happened last month. Before that, GZE was kicked out of Myanmar.

No more GZE. The questions surrounding the GZE-Curaçao-MDPT saga have not gone away however. We need answers, accountability, no business as usual. However painful it may be, it’s always better to be up front than leave questions unanswered.

On 4 November 2018 an independence referendum will be held in New Caledonia giving its voters the choice of becoming an independent country. Its flag is probably among the prettiest I’ve seen (see photo). OK, but why should we care? After all New Caledonia is a French overseas territory consisting of various islands in the southwest Pacific Ocean.

New Caledonia is also an EU Overseas Country and Territory (LGO) just like Curaçao. If we’ve been paying attention at all, the long held assumption that the LGO status is carved in stone as some local politicians are claiming, is anything but true. Besides New Caledonia, we must face the fact that because of Brexit the status of 11 British OCTs is on the line. See complete list of OCTs below. Greenland, the sole Danish LGO, is gradually assuming control of the handful of policy areas still controlled by Denmark before taking the step towards independence. Other LGOs, including Bonaire, Statia and Saba, but also Falkland Islands may soon become an integral EU territory, the so-called ultra-peripheral regions (UPG) like Guadeloupe and Madeira.

Government authorities in Paris have stated that they will recognise and abide by the results of the referendum next week. Curious is that if voters fail to support independence this time, New Caledonians will have opportunities to vote again in 2020 and 2023.

It’s striking how little attention both government and academia in Willemstad are paying to these types of world developments. Apparently we’re not aware that we can ill afford to be eternal bystanders in a world that’s rapidly changing. Not surprisingly China is paying lots of attention. That Asian giant is even cheering some of these LGOs to drift away from their old colonial masters. This while the Chinese are brutally suppressing any kind of freedom in their own backyard, Tibet and Taiwan. Chinese state-backed firms have been eagerly pouring money into Greenland’s rare-earth mines.

Curaçao needs to be alert. Whatever the result of the independence referendum in New Caledonia.

The longest meetings I’ve experienced in my professional life are those between the economic unit and staff of the United Nations office in Chad. Everyone had an opinion, even those who’ve never had a single economics class. Curiously, meetings about how to contain the expansion of the Sahara desert never took long as discussions on this matter were left to the experts. But, I digress. I want to discuss the economic malaise of Curaçao.

I’ve recently heard that we’ve to be optimistic for the economy to grow. Optimism is key, but it’s a result of current or future expectations which, in turn, depend on good pro-grow policies. Optimism is not a policy.

We’ve heard that people have to spend more (plakatinkulora in Papiamentu). Again, correct. But nobody will spend more money, and the private sector will remain reluctant to take risk and invest if people do not expect things to change. Real change comes with a good policy mix by the Government, not with ad hoc ideas that sometimes fly a bit too close to the sun.

Others say we need to export more. True. Our balance of payments has been screaming for a solution for years now. Yet we have no trade policy, we don’t comply with the World Trade Organization (WTO) and don’t have a single trade agreement. Yet, we don’t even talk about this.

Finally, popular with politicians: we need to attract fresh foreign investments and do something about the projects that are, sometimes for decades, in the pipeline. A big yes. Yet we seem not to realize that the reason it’s difficult to attract investments is because we lack the policies and infrastructure that make us attractive for investments. Secondly, so many projects are in the pipeline because of our stiffing regulatory environment and inflexible, antiquated policies. Talking about investments won’t cut the mustard. Good policies will.

With all due respect to the people who have been talking about resolving the economy with pep rallies: it’s about policies, stupid. We need to streamline and automate procedures, eliminate unnecessary red tape, make the labour and capital markets more flexible, get our act together with the WTO, design a trade policy, negotiate trade treaties and have a demographic policy to counter our shrinking and aging population.

It’s not easy, but we need less cheering and more action to make it happen.

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Alex David Rosaria (50) is from Curaçao and has a MBA from the University of Iowa. He is a former Member of Parliament, Minister of Economic Affairs, State Secretary of Finance and UN Implementation Officer in Africa and Central America.